Bull s
JK Holdings
Quarterly ReportAugust,2020
CONTENTSInternational

P159No.

Impact of the outbreak of Covid-19
and the company policies

P2

Prospect of Business Condition
for July − Septembe

P3

Market Outlook Plywood
Butsurin's park management businessshowing good performance

P4

JK Holdings Expanded the Group

Impact of the outbreak of Covid-19
and the company policies
The threat of the pandemic of Covid-19 is undiminishing, andthe number of cases is showing an increasing trend in Japan
since the state of emergency was lifted.
In the housing-related industry, demand is expected to gradu-Keiichiro Aoki

President
JK Holdings Co.,Ltd.

ally decrease due to structural factors including Japanʼs depopulation. In addition to it, companies are now coping withis the theme of our groupʼs mid-term business plan “Break-the rapidly changing work environment by taking measuresthrough 21”.

as follows: (1) thoroughly enforce the infection prevention
measures, (2) review the conventional visiting sales and face-

Major policies include extension of non-housing businesses,

to-face meetings, (3) avoid making crowds by adopting work

which are represented by middle- and large-scale wooden

from home and Zoom meetings, and (4) set new policies toconstruction, change to wooden interior and exterior, andmaintain oﬃce eﬃciency.

Park-PFI (private ﬁnance initiative). Featuring the ﬂexibility
and the warmth of wood, and using our diversiﬁed processing

Under the circumstances, JK Holdings Group is working ontechniques and eagerness for higher ﬁre-resistance, we willconcrete measures setting “Catch the certain signs of change,

create new demand for wooden construction and develop its

Take steady moves, and Do what we can” as a guide, which

new applications.
Japan Kenzai Co., Ltd., our core business, is planning to
break away from the dependence on housing starts as well as
stimulate and respond to the potential demand in the market.
Speciﬁcally, it will prepare for becoming its customersʼ best
partner by reorganizing the industrial materials sales structure
by region, which was based on business ﬁelds with special
sales departments and general distribution departments fordealers, and combining the knowledge and networks we havecultivated in our respective ﬁelds.
In the business side, it will steadily update an environment of
hardware, networks, the groupware and other things. At thesame time, it is developing systems which will contribute tostreamline the sales sector, upgrade business activities, andmake administrative tasks eﬃcient.

Bulls International No.59

2Surveyis the second lowest in the record. By
region, a fall in the index is noticeable
across the country. As a result, demandis expected to decline after July.

Prospect of BusinessCondition for
July-September<Survey Results on theCoronavirus Impact><Demand Forecast byBuilders and Distributors>

How is the construction work affected?
The most common response is“delayin construction period”, followed by“outof stocks” and “cancellation of contract”. There are situations where delays
as well as cancellations occur.

We expanded the subject to the survey
to include more contractors and builders in order to investigate the economic
impact of the coronavirus pandemic,
and enlarged the scope of questions.
The survey was conducted through theInternet. The demand forecast for Julyto September 2020 shows an index ofminus 67.0 points among small builders(contractors and other building companies). The sharp drop is as bad as the record low of minus 77.0 points for April
to June 2009 since the survey started
in 1992. Among distributors, an index
of minus 68.6 points is found, which

What is the impact on your businessactivities?
Only about 20% responded that “workfrom home” system was implemented.
Staggered working hours and taking
days oﬀ have been introduced, but nearly half of the respondents do not adopt
them in practice. Nearly 40% of sales
activities are conducted as usual.

What is the status of the contract?
The same tendency is
Demand Forecast by Builders
observed for both new
10
construction and re0
0.3 1.0 5.1 2.0
modeling projects. The-10-5.7-8.1-7.3
overwhelming majority
-20
-18.3
-30
of the respondents an-40
swered that “the number

is decreasing”, but 25% answered “thesame as usual”. For what will be postponed, the responses are mostly until“June to July” or “August to September”. Some are “longer delay until afterOctober”.
Regarding support measures
The majority replied that they have “noplans to use” the governmentʼs emergency aid packages, while nearly 40%
is “under consideration”. The government takes a wide range of measures,
including providing ﬁnancial support
for loans, aside from on-site backing
such as easing the inspection procedures and extending the application
period for the next-generation housing
point system.

<Sales Forecast by Leading
Manufacturers>
Among the sales forecast by leading
manufacturers, all the sectors see zero
point for growth, which is the ﬁrst phenomenon ever since the survey started.
It shows that the leading manufacturers
have a severer view on the businessthan the builders and distributors do.

-50-60The forecast survey for July to September 2020 is based on the totaled data
gathered from 3,000 client companies in Japan through the Internet, which
took place from late-April to mid-May 2020.

-67-70-80 Jul-Sep
2018

Jan-Mar2019

Jul-Sep
2019

Jan-Mar
2020

Jul-Sep
2020

Point0=business result in April-June,1992

Dealing Volume of Lumber

Demand Forecast by Distributors
20

9.2

10-3.70-10-20

1.9

65

4.9

60

1.9-5.5-15.4-6.455
50-30-40-60

40-68.6-70-80

Laminated lumber
Solid lumber
Precut lumber
LVL45-50

Jul-Sep
2018

Jan-Mar2019

Jul-Sep
2019

Jan-Mar2020

35 Jul-Sep

Jul-Sep2020

2018

Jan-Mar2019

Jul-Sep
2019

Jan-Mar
2020

Jul-Sep2020

Point100=all responses expect increase

Point0=business result in April-June,1992

Sales Forecast by Major Supplying Manufacturers（Jul-Sep 2020）
increaselevel-offdecreaseover15％14 ～ 10％

below10％

below10％10 ～ 14％

over15％

0.0

0.0

0.0

4.0

31.1

41.9

23.0

0.0

0.0

0.0

1.8

1.8

10.7

85.7

0.0

0.0

0.0

1.4

29.2

48.6

20.8

House Equipments（9firms）

0.0

0.0

0.0

22.8

27.1

6.343.8

average

0.0

0.0

0.0

7.5

22.3

26.9

43.3

Plywood（13firms）
Wooden Building Materials（10firms）
Ceramic/Heat Insulation（15firms）

International No.59

Trend
Market Outlookof Plywood<Trend of Domestic Plywood>
Japanʼs production of softwood plywood was 215,900 cubic meters in
May 2020 (84.4% of the result in thesame month of the previous year), andshipments were 211,500 cubic meters (80.1%). Inventories increased to178,700 cubic meters (134.2%). The
impact of the COVID-19 pandemic has
been profound, showing in the continuing suspension of on-site work and production cutbacks by the manufacturers.
Due to the sluggish market, almost all
domestic plywood manufacturers havealready announced that they are cutting
production until August. The reduction
in supply volume may continue after
August, depending on future market
conditions. We hope demand will recover as soon as possible.

<Trend of Imported Plywood>
Arrivals of imported plywood in Japan
were 204,332 cubic meters in May
2020 (109.4% of the result in the samemonth of the previous year). By country of origin, those from Malaysia saw
69,900 cubic meters (109.7%), thosefrom Indonesia 69,900 cubic meters(121.5%), and those from China 47,000
cubic meters (90.8%).

Bulls

The market is as sluggish as domestic
plywood, and spot purchases are continuing. Naturally, the amount of neworders from Japan placed to the producing regions is declining, and arrivals
are expected to decrease in the future.
Given the cooling of demand, it willtake a little more time to restore thesupply-demand balance.

Wholesalers' Prices of Plywood in Tokyo

yen/sheet

Imported Plywood（Structural Use）
Imported Plywood（Concrete Form）
Domestic Plywood［Softwood Plywood for Structural Use(12mm)］
Domestic Plywood［Softwood Plywood for Structural Use(24mm)］

2500

2000

1500

1000

5000Feb 2020

Mar 2020

Apr 2020

May 2020

Jun 2020

Jul 2020

Topics

Butsurin’s park management businessshowing good performance
Timber Scape Co., Ltd., a subsidiarycompany 100% owned by Butsurin Co.
Ltd., is promoting a business where thepublic greening & landscaping businessand the wooden construction businessare united, centering on two axes of thewooden construction department specializes in change to wood construction& wood use and the park management
department. On Toyosu Gururi Park,
which is managed by Toyosu Park Management JV, Timber Scape is designatedto perform the administrative operationof the 19.7ha park for 10 years.
Timber Scape is engaged in practicalwork from maintenance of the green
spaces to construction of a large-scale

wooden restaurant “Park Restaurant”(tentative name). In the coming threeyears, it is going to build wooden facilities such as a park management oﬃce,
a gymnasium, and a barbecue house. In

addition to Toyosu, the company is doing construction of facilities related tothe Olympics, as well as the installationof signboards and the maintenance ofparks and green spaces in urban areas.

34Bulls International No.59

CompanyJK Holdings Expanded the GroupThe JK Holdings Group consolidated three companies in May to July 2020.
The move is aimed at boosting synergies among the groupʼs businesses.

1. Yotutuzi Seizai Co., Ltd.
Founded: 1976
Sales: 762 million yen
President and CEO: Yotutuzi Norihiko
Business Profile: Sales of home equipment, plywood,and interior building materials mainly
in Kyoto City and Nagaokakyo City

2. Idashouzi Co., Ltd.
Founded: 1951
Sales: 436 million yenPresident & CEO: Miyamoto Hironobu
Business Profile: Long-established plywood wholesaler engaged in processing
and sales of plywood, various ﬁberboards, and cut processing

3. Kyoto Itagarasu Co., Ltd.
Founded: 1950
Sales: 1.59 billion yen
President & CEO: Yanase Tomoyuki
Business Profile: Wholesale and construction of building glass and window
sashes mainly in Kyoto Prefecture

It is a challenge to work on new businesses and new merchandise, while housing starts aredecreasing. We look forward to seeing how the businesses of the three companies who areactive especially in the Kansai region and the JKHD Group will merge and grow.
Wood Land Tower 1-7-22 Shinkiba Koto-ku,Tokyo 136-8405 Japan
Phone +81-3-5534-3800 Fax +81-3-5534-3833
E-mail kouhou@jkhd.co.jp
URL http://www.jkhd.co.jp
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